Skilled worker salary thresholds set to rise in April

Employers who sponsor skilled foreign nationals are required to pay a minimum salary set by the Home Office.  The most recently published Statement of Changes (HC1160) to the immigration rules (9 March 2023) sets out the increases to the salary thresholds for skilled workers that will be effective from next month (12 April 2023).

Employers who recruit foreign workers under this route need to be extra vigilant to ensure they factor this into point based assessments.

What are the changes?

• The current annual general salary threshold of £25,600 per year will increase to £26,200.
• The lower salary threshold for new entrants, shortage occupation applicants, those in health or education occupations and PhD holders, will increase from £20,480 to £20,960.
• “Going rates” under the published occupation codes for each role set out in Appendix Skilled Occupations will continue to apply, however employers also need to factor in that going rates will be based on a 37.5 hour working week rather than the current 39 hour working week. This is a key consideration that employers cannot afford to miss for those who are contracted for more than 37.5 hours per week, as their salary offer will need to be pro-rated, to calculate eligibility for sponsorship.

When are the changes effective?

These changes will apply to all visa application made using a Certificate of Sponsorship that is issued on or after 12 April 2023. However, employers who currently sponsor under the existing salary thresholds do not need to make any changes with their sponsored worker.

What do these changes mean for employers?

The increase to the salary threshold for skilled workers is vastly triggered by the rise to the national minimum wage that will increase from £9.50 an hour to £10.42 an hour in April, and is highly unlikely to deter employers from sponsoring under this route.

However, employers do need to be mindful that it may impact on extension applications and future applications for settlement known as indefinite leave to remain.

For those businesses that are in the process of assessing candidates for sponsorship, it is imperative that the new salary threshold is considered for those where a Certificate of Sponsorship will be assigned from 12 April, to ensure they do not fall short of meeting the eligibility requirement for their skilled workers.

We’re here to help

If you would like to discuss the upcoming changes and how this may affect your business, please contact Tijen Ahmet or Calum Hanrahan in our business immigration team.